Miss Crystal Palace purchased a crystal for $650,000., Problem Set 4 help

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Mathematics

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Problem Set 4

Directions:

1. Solve the following problems. Hand write your solutions and explanations on your

own paper. Do not write answers on this page.

2. Show your work AND explain your reasoning using complete English sentences.

Explanations must directly follow the solution for each part of the problem.

3. You must write your name on the top right of the paper you turn in.

4. You must write the title of this problem set on the top of your paper.

5. Turn in your solutions following the directions in the assignment information on

Blackboard.




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Problem Set 4 Directions: 1. Solve the following problems. Hand write your solutions and explanations on your own paper. Do not write answers on this page. 2. Show your work AND explain your reasoning using complete English sentences. Explanations must directly follow the solution for each part of the problem. 3. You must write your name on the top right of the paper you turn in. 4. You must write the title of this problem set on the top of your paper. 5. Turn in your solutions following the directions in the assignment information on Blackboard. Formulae for Finance I Pr t A P(1 rt)   r  A  P 1    n nt   r  nt   1    1  n  A  PMT   r     n     r  nt  nt  1    1  n  r  P1    PMT   r    n   n    r U  P 1    n nT   r  nT   1    1  n   PMT   r     n   1. Miss Crystal Palace just purchased – you guessed it – a crystal palace for $650,000. She makes a 25% down payment and finances the balance with a mortgage at an interest rate of 5.6% for 15 years, making monthly payments. a. What amount will she borrow? b. Complete the amortization table for the first two payments. Show all work? 2. Meagan invests $1,200 each year in an IRA for 12 years in an account that earned 5% compounded annually. At the end of 12 years, she stopped making payments to the account, but continued to invest her accumulated amount at 5% compounded annually for the next 11 years. a. What was the value of the Ira at the end of 12 years? b. What was the value of the investment at the end of the next 11 years? c. How much interest did she earn? Problem Set 4 – Grading Criteria 1. Total: 10 points a. Total: 2 points Breakdown Correct work: 0.5 points Correct answer: 1 point Sentences explaining reasoning: 0.5 points b. Total: 8 points Breakdown Payment Correct work: 2 points Correct answer: 1 point Sentences explaining reasoning: 1 point Amortization Table Correct work: 2 points Correct answer: 1 point Sentences explaining reasoning: 1 point 2. Total: 10 points a. Total: 4 points Breakdown Correct work: 1 point Correct answer: 2 points Sentences explaining reasoning: 1 point b. Total: 4 points Breakdown Correct work: 1 point Correct answer: 2 points Sentences explaining reasoning: 1 point c. Total: 2 points Breakdown Correct work: 0.5 points Correct answer: 1 point Sentences explaining reasoning: 0.5 points
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Problem set 4
Question 1:
Miss Crystal Palace purchased a crystal for $650,000. She makes a 25% down payment and
finances the balance with a Mortgage at an interest rate of 5.6% for 15 years, making monthly
payments.
a) The amount she pays as the down payment:

The amount she has to pay using the mortgage is:

Therefore, the amount she borrows is
b) Amortization table for the first two payments.
Let

Therefore, the monthly payment will be:

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